Banking / Tokenized Deposits

Tokenized Deposits: Banking's New Standard

Tokenized deposits are commercial bank deposits recorded as tokens on a blockchain. Unlike stablecoins they stay deposits, a liability of the bank, and JPMorgan, HSBC and Canada's six largest banks are putting them into production.

Summary

Tokenized deposits are commercial bank deposits recorded as tokens on a blockchain, so the token is the deposit itself and a liability of the issuing bank. Regulators treat them that way. Canada's Office of the Superintendent of Financial Institutions (OSFI) said on 10 September 2026 that tokenized deposits are "not legally distinct from traditional deposits" and that the underlying technology does not determine a product's legal nature.

How it works

The difference from a stablecoin is who owes the money and on what terms. A payment stablecoin is issued against a pool of reserves. Under the US GENIUS Act, passed in July 2025, the issuer must hold high-quality liquid reserves at least 1:1, cannot pay holders interest or yield, and the coin is neither a bank deposit nor federally insured. A tokenized deposit remains a deposit, so it can pay interest and inherits the deposit insurance of the account behind it, as the Federal Reserve Bank of Richmond summarized in November 2025. Stablecoins circulate on public chains to anyone who holds the token. Tokenized deposits so far run on permissioned rails for a bank's own clients.

Most programmes are single-bank. J.P. Morgan made JPM Coin (JPMD), a USD deposit token, available to institutional clients on Base in November 2025, with near-instant 24/7 transfers between EVM-compatible wallets; B2C2, Coinbase and Mastercard were early users. Citi Token Services runs on a private, permissioned blockchain and moves client cash around the clock between Citi branches in several markets (see our page on Citi Token Services).

Corporate treasury is the first real use case. HSBC launched its Tokenised Deposit Service in Hong Kong on 22 May 2025, offering real-time, always-on HKD and USD payments between corporate wallets. Ant International was the first client, moving funds between its own entities through its Whale treasury platform, after an October 2024 cross-bank test in the HKMA's Ensemble sandbox. HSBC says the service is designed to integrate with the HKMA's tokenisation and digital money infrastructure. Standard Chartered built a similar solution for Ant International in Singapore and Hong Kong in December 2025.

The harder problem is moving tokens between banks. On 22 September 2026 BMO, CIBC, National Bank of Canada, RBC, Scotiabank and TD announced a joint initiative for Canadian-dollar tokenized deposits. Its first phase will explore moving tokenized deposits efficiently across Canadian financial institutions, with a longer-term aim of connecting to other digital asset initiatives. It followed OSFI's statement by 12 days.

Banks prefer this model because the money stays in the regulated banking system, keeps paying interest and stays on their balance sheet, while the token adds 24/7 movement and programmability. A tokenized deposit can be released when a tokenized bond or fund share is delivered, which is how cash and assets settle together on one ledger. Interbank models matter for that. A token that can only move inside one bank cannot pay a seller who banks elsewhere.

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